04/06/2013
IRDA may tighten norms for banks selling insurance
Banks may find the going tough in distributing insurance polices. The insurance regulator may require them to renew at least half the life insurance policies they sell, failing which they risk losing the licence to distribute insurance products.The renewal requirement is one of the recommendations of a committee set up by the Insurance Regulatory and Development Authority (IRDA) in order to curb mis-selling.
In 2011, IRDA had ushered in a minimum policy renewal criteria for individual insurance agents. The regulator directed insurance companies to terminate the contracts of agents who fail to get at least half the policies sold by them renewed in the subsequent year.
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25/05/2013
Good financial health, track record must for insurers setting sights abroad: IRDA
Indian insurance companies can now go global. They require a minimum of three years of operation, among other criteria, to be eligible to apply for opening offices overseas.According to the guidelines issued by the Insurance Regulatory and Development Authority (IRDA), the life and general insurers should have a net worth of Rs 500 crore and Rs 250 crore respectively.In the case of reinsurers, the minimum net worth required has been fixed at Rs 750 crore.They should be in good financial health and should have posted profits for three years in the last five years from the date of application to the regulator, with prescribed solvency ratios.The applicants “should not suffer from any adverse report of the Authority on its track record of regulatory compliances, for three years out of the last five years,’’ T.S. Vijayan, Chairman, IRDA, said in a circular.
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22/05/2013
Insurance broking to become more flexible with new norms
The insurance broking business will become more professional and flexible with the new norms coming into force, according to those in the sector.A recent report by the Insurance Regulatory and Development Authority (Irda) committee on insurance broking, chaired by Suresh Mathur, suggested certain amendments to the broking regulations. While the ceiling on business from one client has been increased to 50 per cent, the period of re-application for licence by a broker has been set at after one year from the date of cancellation.
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11/05/2013
Offer maturity benefits on micro-policies: IRDA
The insurance regulator, Irda, wants risk cover providers to offer maturity benefits on every micro-insurance plan to make it attractive. It may allow business correspondents of banks to sell policies in the country's rural belt to push the product. Insurance Regulatory and Development Authority is revising the micro-insurance guidelines to include this proposal and boost sales. Micro-insurance, which is being sold to the economically weaker section, has seen a steady decline since 2010. "We need simple and cost-effective policies with some reasonable returns to push micro-insurance," said Sudhin Roy Chowdhury, member (life), Irda.
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09/05/2013
New guidelines for banks doing insurance broking
Banks wishing to become insurance brokers might have to segregate a broking arm, which would be an independent accountable unit.
The report of the Insurance Regulatory and Development Authority's committee on insurance broking says the bank broking unit shall have at least two persons with the requisite qualifications, mandatory theoretical and practical training and having passed the examinations required by the examining body.
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09/05/2013
Index-linked products may go off the shelf
Index-linked insurance products (Ilips) are expected to remain absent from the product portfolio of life insurers from October onwards.
In tandem with the new product guidelines, Ilips would not be considered as a separate product category. Life insurers have approached the Insurance Regulatory and Development Authority (Irda) to allow the sale of these products post the October deadline.Ilips are those insurance products whose benefits/returns are linked to benchmark indices.
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08/05/2013
IRDA wants LIC in energy insurance pool for Iran
Insurance watchdog has suggested Life Insurance Corporation (LIC) should join the energy insurance pool proposed by the government to provide cover to domestic firms for processing Iranian crude oil.Suggestion comes after general insurance companies and oil firms raised concerns that the proposed Rs 2,000 crore energy insurance pool may not be sufficient to provide risk cover to Indian refineries processing Iranian crude.
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03/05/2013
Irda head, life insurers discuss dip in growth
Chief executive and actuaries of the 24 life insurance companies had a meeting on Thursday with T S Vijayan, chairman of the Insurance Regulatory and Development Authority (Irda). It was his first meeting with heads of this segment of the sector after becoming the head of Irda, in late February.
Officials said the discussion centred around the slowing growth of the life insurance segment and what to do about it. The meet discussed the traditional product guidelines and procedures in implementation, new pension norms and means of expanding portfolios.Vijayan discussed what needs to be done to boost insurance penetration and density. Insurance penetration, measured as the percentage of insurance premiums to gross domestic product, was 4.1 per cent in 2011, compared to 5.1 per cent in 2010.
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13/04/2013
FM asks IRDA to increase insurance density
Finance minister P Chidambaram on Friday urged the insurance regulator to focus more on its developmental role to increase the insurance penetration in the country, which is well below its need and potential. "For the first time we have a former insurer as the head of IRDA and you have a mandate to develop the insurance industry. While regulations are important, development of the industry is equally important," he said referring to TS Vijayan, the new chief of Insurance Regulatory and Development Authority (IRDA).
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11/04/2013
Reinsurance norms will ‘deter new investors’
The limits set by the regulator to maximise retention of reinsurance business within the country will constrain insurers’ freedom, says Global Federation of Insurance Associations (GFIA).GFIA has 32 member-associations which represent insurers that account for around 88 per cent of total insurance premiums worldwide.
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